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BTC $96,420 +2.34% ETH $3,280 +1.82% SOL $185.40 -0.92% BNB $642.50 +0.45% XRP $2.18 +3.12% DOGE $0.082 -1.50% ADA $1.05 +0.80% AVAX $42.10 +1.15%
BTC $96,420 +2.34% ETH $3,280 +1.82% SOL $185.40 -0.92% BNB $642.50 +0.45% XRP $2.18 +3.12% DOGE $0.082 -1.50% ADA $1.05 +0.80% AVAX $42.10 +1.15%
10/29/2024

Bitcoin Breaks $71,000: Is a Bull Run on the Horizon?

Bitcoin delivered on expectations, once again breaking through the $70,000 level early this morning and hitting a high of $71,000. This represents growth of more than 4% over the past 24 hours, with Bitcoin currently trading around $71,000. Even Ethereum (ETH), which the Twitter community had written off, rebounded after dipping to $2,382, climbing back above $2,600. Many altcoins, following their recent correction, are also seeing a recovery. Dogecoin, fueled by a tweet from Elon Musk, surged

Bitcoin Breaks $71,000: Is a Bull Run on the Horizon?

Bitcoin delivered on expectations, once again breaking through the $70,000 level early this morning and hitting a high of $71,000. This represents growth of more than 4% over the past 24 hours, with Bitcoin currently trading around $71,000.

Even Ethereum (ETH), which the Twitter community had written off, rebounded after dipping to $2,382, climbing back above $2,600. Many altcoins, following their recent correction, are also seeing a recovery. Dogecoin, fueled by a tweet from Elon Musk, surged 17%, breaking past $0.16.

Derivatives Data Highlights a Volatile Market

According to Coinglass, $173 million was liquidated over the past 24 hours, with $69.78 million in long positions and $103 million in short positions wiped out. This points to a volatile market with both bullish and bearish sentiment at play.

What Factors Are Driving the Market Higher?

Several factors are contributing to the bullish market trend:

  • Fed Rate Cut: The U.S. Federal Reserve is expected to hold a policy meeting on November 6–7. Markets are nearly certain the Fed will cut rates by 25 basis points. The CME FedWatch Tool shows a 98.4% probability of a 25 basis point cut, a 1.6% chance of no cut, and 0% probability of a 50 basis point cut.

Continued rate cuts would pump additional liquidity into the global economy, supporting risk assets. This liquidity boost has been driving sentiment across the crypto space.

  • Microsoft Considering a Bitcoin Purchase: A growing number of major corporations are weighing whether to add Bitcoin to their strategic reserves.

In a Form 10-K filing with the Securities and Exchange Commission on Thursday, Microsoft highlighted topics set to be discussed at its upcoming shareholder meeting. One proposal suggests the tech giant should consider Bitcoin as a hedge against inflation and other macroeconomic risks.

The filing revealed that the board recommended shareholders vote against the proposal, stating that Microsoft had "carefully considered the matter." The statement read: "Previous evaluations have looked at bitcoin and other cryptocurrencies as potential options, and Microsoft will continue to monitor trends and developments related to cryptocurrency to inform future decisions. As noted in the proposal itself, volatility is a factor to consider when evaluating cryptocurrency investments, which require stable and predictable investments for corporate financial applications to ensure liquidity and working capital. Microsoft has established robust and appropriate processes to manage and diversify corporate finances for long-term shareholder benefit, and this public assessment is not necessary."

Microsoft's largest shareholders include Vanguard, BlackRock, and State Street.

  • Strong Inflows into Spot Bitcoin ETFs: Data shows strong inflows into spot Bitcoin ETFs since the start of the month. There was one week of net outflows, but the remaining 12 weeks saw significant net inflows. On October 14, a single day saw net inflows exceeding $555.86 million.

Total net inflows into U.S. spot Bitcoin ETFs currently stand at $21.93 billion. Total on-chain holdings have surpassed 1 million BTC. Data from CryptoQuant CEO Ki Young Ju reveals that institutional holdings in U.S. spot Bitcoin ETFs account for approximately 20% of the total, with asset management firms holding around 193,000 BTC.

  • Bitcoin's Golden Cross: Market analyst Omkar Godbole noted that Bitcoin's 50-day simple moving average (SMA) has begun turning upward and could cross above the 200-day SMA within the next few days, confirming a "golden cross."

This pattern indicates that short-term price momentum is overtaking long-term momentum, which could develop into a full bull market. While moving average-based indicators are often criticized as lagging signals that can leave traders on the wrong side of the market, golden crosses have historically preceded powerful rallies.

Holding Bitcoin for one year after the first and second golden crosses, and after the May 2020 golden cross, yielded returns in the hundreds of percent. Following the golden cross on October 30, 2023, Bitcoin doubled in value and reached a new all-time high above $73,000.

This bullish market trend, further reinforced by the recent golden cross, suggests the upward trajectory may continue.

  • U.S. Presidential Election: The U.S. presidential election is approaching, and historically, crypto markets have seen favorable gains around this time. In the previous election, there was even a post-result rally, despite a dip in the days leading up to and immediately following the announcement.

Looking further out, the market views both a Harris or Trump victory as a net positive for crypto. As a result, some investors are choosing to position themselves ahead of a potential rally.